Q: In the electricity pricing model, we assumed that the capacity level
In the electricity pricing model, we assumed that the capacity level is a decision variable. Assume now that capacity has already been set at 0.700 million of mWh. (Note that the cost of capacity is n...
See AnswerQ: In the electricity pricing model in Example 7.4, the
In the electricity pricing model in Example 7.4, the demand functions have positive and negative coefficients of prices. The negative coefficients indicate that as the price of a product increases, de...
See AnswerQ: Continuing Problem 6, suppose the company is selling in the United
Continuing Problem 6, suppose the company is selling in the United States, the United Kingdom, and Japan. Assume the unit production cost is $50, and the exchange rates are 1.22 ($/£) and 0.00965 ($/¥...
See AnswerQ: In the complementary-product pricing model in Example 7.3
In the complementary-product pricing model in Example 7.3, we have assumed that the profit per unit from shirts and ties is given. Presumably this is because the prices of these products have already...
See AnswerQ: Continuing the previous problem (the model in part a) one
Continuing the previous problem (the model in part a) one step further, assume that shirts and ties are also complementary. Specifically, assume that each time a shirt is purchased (and is not accompa...
See AnswerQ: In estimating the advertising response function, we indicated that the sum
In estimating the advertising response function, we indicated that the sum of squared prediction errors or RMSE could be used as the objective, and we used RMSE. Try using the sum of squared predictio...
See AnswerQ: The best-fitting advertising response function fits the observed data.
The best-fitting advertising response function fits the observed data. This is because we chose the observed data to fall close to a curve of the form. See what happens when one of the observed points...
See AnswerQ: The file contains a template for a car loan. Specifically,
The file contains a template for a car loan. Specifically, once values are entered in the blue cells, you need to enter formulas in the gray cells to calculate the amount financed, the monthly payment...
See AnswerQ: In judging the fit of the estimated response function, you could
In judging the fit of the estimated response function, you could use MAE (mean absolute error) instead of RMSE. MAE is the average of the absolute prediction errors. a. When you run Solver with MAE as...
See AnswerQ: Starting with the solution to the advertising selection problem, suppose the
Starting with the solution to the advertising selection problem, suppose the company, for whatever reason, cannot place ads on “SportsCenter.” Make the appropriate changes in the model and rerun Solve...
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